Goldman gets back to profit
(17 April 2009 – USA) US Banking giant, Goldman Sachs has turned around a fourth quarter loss to a better than expected gain for the first quarter of 2009.
Goldman Sachs reported a net profit of US$1.81 billion ($2.46 billion), compared to a net loss of USS2.12 billion incurred in the previous reporting quarter, the three months to the end of November 2008. The quarter profit beat out analyst expectations.
Goldman Sachs switched from a fiscal year that ended in November to a calendar year. The missing month in the mix was December 2008, which also incurred a net loss of US$780 million. For Goldman, 2009 was a clear turning point.
The first-quarter results, for the period ended on March 27, are not directly comparable to the same period in 2008, which ended in late February and saw net profit of $US1.51 billion.
The major difference between the end of 2008 and the start of 2009 was a significant drop in revenue from Trading and Principal Investments, which went from a US$4.5 billion outflow to a US$5.7 billion dollar gain.
Net revenues for the bank’s Investment Banking division, however, were 30 percent lower than the first quarter of 2008 and 20 percent lower than the last quarter of 2008.
Goldman's chairman and chief executive, Lloyd Blankfein, said that the results reflect the strength and diversity of the bank’s client franchise, the resilience of the business model and the dedication and focus of its people.
Goldman last year changed its status from investment bank to just plain bank in order to steady expectations and gain funding in the difficult economic environment. Goldman also announced that it would sell US$5 billion in common stock to partly pay off the US$10 billion Government rescue that it had received.
Goldman Sachs switched from a fiscal year that ended in November to a calendar year. The missing month in the mix was December 2008, which also incurred a net loss of US$780 million. For Goldman, 2009 was a clear turning point.
The first-quarter results, for the period ended on March 27, are not directly comparable to the same period in 2008, which ended in late February and saw net profit of $US1.51 billion.
The major difference between the end of 2008 and the start of 2009 was a significant drop in revenue from Trading and Principal Investments, which went from a US$4.5 billion outflow to a US$5.7 billion dollar gain.
Net revenues for the bank’s Investment Banking division, however, were 30 percent lower than the first quarter of 2008 and 20 percent lower than the last quarter of 2008.
Goldman's chairman and chief executive, Lloyd Blankfein, said that the results reflect the strength and diversity of the bank’s client franchise, the resilience of the business model and the dedication and focus of its people.
Goldman last year changed its status from investment bank to just plain bank in order to steady expectations and gain funding in the difficult economic environment. Goldman also announced that it would sell US$5 billion in common stock to partly pay off the US$10 billion Government rescue that it had received.
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